Fed set for another cut, but it's not likely to make markets happy

The Federal Reserve is set to make another move on interest rates. But markets, and the President, aren't likely to be happy with what they do.

And with the trade war still going on all signals are pointing to another cut of a quarter point. Samuel Rines with Avalon Advisors tells KTRH that won't satisfy the President, and he's probably right.

"Simply due to the bond market already telling us that things are a little worse than they were before, and that the Fed needs to cut two or three more times," Rines stated.

In fact, Rines says if he were Fed Chair Jerome Powell, he would make the cut at least a half point.

"If you do that, it surprises markets. They begin to feel the Fed has their back, and you probably don't have to do another cut right away," Rines explained.

Other experts agree with Rines, saying that gradual cuts will never allow the Fed to get ahead of markets. But Powell himself didn't seem concerned on Friday.

"I wouldn't see the recession as the most likely outcome in the U.S.," he said during a question-and-answer session in Zurich, Switzerland on Friday, adding that “the most likely outlook is still moderate growth, a strong labor market and inflation continuing to move back up," Powell said.

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